The childcare crisis in the United Kingdom is more than just a pressing social issue; it’s a ticking time bomb with profound economic repercussions. The UK’s broken childcare system is an epidemic that has significant negative impacts on UK economic productivity and exacerbates the gender pay gap. Whilst initial progress has been made to address the crisis, specifically increasing demand for childcare, more needs to be done to address shortfalls in supply.
The astronomical cost of childcare has forced one in four UK parents to quit their jobs or drop out of education. This issue is highly gendered, with women predominantly bearing the brunt of unpaid domestic labour and childcare responsibilities. Consequently, women face a widening gender pay gap amid the relentless cost of living crisis. Bridging the gender gap could generate an extra £150 billion in GDP by 2025, with childcare provision playing a crucial role in unlocking this potential.
Additionally, investment in early childhood education (ECE) yields significant long-term socioeconomic benefits. Indeed, children who receive high-quality ECE are 14% more likely to be employed as adults, earn higher annual incomes, and can indirectly lower the likelihood of individuals engaging in criminal activities. Advancements in social mobility caused by ECE clearly highlight the need for a fully-functioning childcare system.
Earlier this year, the UK government announced a £4 billion childcare reform package in response to the childcare crisis. The reforms included various initiatives such as the Extended Early Years Free Entitlement program, which grants children under three 15 hours of weekly free childcare, increasing to 30 hours per week by 2025. Additionally, the Government are attempting to incentivise new childminders with a £600 sign-up bonus to bolster recruitment in the childcare industry.
Whilst these reforms are a step in the right direction, they largely fail to address the rapidly declining supply of childcare providers. It is imperative that the Government address this issue, as focusing solely on increasing demand for free childcare will create a chasm between expectations and capacity.
According to a nationwide survey by the Early Years Alliance, a substantial portion of childcare providers plan to offer only a limited number of places under the Government’s scheme for free childcare and charge privately for the rest. Eighty-three percent of providers expect an increase in demand under the new scheme, yet 60% will not be increasing the number of places they offer. This highlights the scheme’s fundamental flaw: demand is increasing, yet supply is not.
Supply is decreasing. There is a critical shortage of qualified childminders, with the number of registered childminders in England declining by 11% in just one year – falling to their lowest number since 2012. Ofsted data shows this results in a loss of more than 20,000 childcare places per annum.
The number of staff employed by voluntary organisations and school-based nurseries is also declining. Childcare professionals are not accepting children eligible for government-funded care due to insufficient government payment. The only childcare providers to increase staffing between 2019 to 2022 were private nurseries, raising serious concerns regarding the perpetuation of socioeconomic disadvantage, given the benefits of ECE.
Ultimately, the financial viability of running a childcare business, coupled with low pay, increasing workloads and the cost of living crisis, is driving professionals away from the sector. Experts, such as Neil Leitch from Early Years Alliance, worry that government efforts to attract new childminders, such as sign-up bonuses, are unlikely to stem the exodus of existing professionals, and risk de-professionalising the workforce.
To successfully tackle the childcare crisis, it is vital to increase the number of childminders and the capacity of existing providers. Expanding the workforce is the only way to bridge the supply-demand gap, increasing childcare provider participation in the Government’s currently ineffective childcare scheme.
Boosting the workforce can be achieved in two ways.
Firstly, recruitment of qualified childcare providers. Promoting early childcare careers to graduates via accessible Teach First style training programmes directly increases the size of the workforce. Germany’s ECEC training programme provides paid employment alongside the equivalent of a bachelor’s degree in vocational training for childcare. Hugely successful, the initiative attracts more applicants than places, highlighting the effectiveness of training programmes in recruitment. These programmes simultaneously increase the quality of ECE. Childcare providers with graduate and Level 3 qualified staff are shown to score highly on quality measures including learning, literacy, and language, and tend to be the most highly graded childcare settings.
The second way to increase the workforce is by incentivising qualified workers to stay in the industry. To retain existing professionals, the Government should increase funding to match the increasing costs of providing childcare services. Currently, the Government pay professionals less than two-thirds of the estimated cost of the provision of free childcare.
Furthermore, the Government must provide employees with professional development opportunities. Multiple countries have implemented effective strategies that retain qualified workers within the childcare sector. Slovenia’s early childcare system promotes preschool teachers to various titles, which correlates with pay rises. Promotion is based on years of experience, performance at work and engagement in additional professional development activities. Staff who are engaged, feel valued and can fulfil career ambitions are more likely to remain within their sector. The UK government should investigate implementing a similar model to decrease the mass departure from the UK’s childcare industry.
Therefore, childcare reforms must target the growth of childcare suppliers. Only by increasing the supply of childminders and the capacity of existing providers can the UK fully resolve the childcare crisis, unlocking the untapped economic potential of parents who currently have no choice but to stay at home.
Annabelle Walking is currently doing work experience at Bright Blue. Views expressed in this article are those of the author, not necessarily those of Bright Blue. [Image: Arron Burden]
